The Truly Sovereign Individual
Let’s take an idea to the absolute extreme case. A truly sovereign individual is not reliant or dependent on anyone else for their survival. They are free from having a boss, clients, and external responsibilities.
While this may sound idyllic, what does this fully sovereign person give up? They must make everything they want for themselves.
A Spectrum of Sovereignty
Let’s take a look back at Balaji’s Centralization modes
Centralized→Decentralized→Re-Centralized
Re-centralization is actually coming back from an extreme. It is a combination of the two previous modes, blending the best of both of them to create something new yet familiar.
What if we applied that thinking to workers:
Employees→ Freelancers→ ?
The next stage of work might be coming back from the extreme of complete self reliance and forming coalitions of workers. These workers would retain some of their freedom of sovereignty while bundling their work together with others under a new corporate/collective structure.
DAOs Re-bundle Work
Decentralized Autonomous Organizations, often shortened to DAOs, are a re-bundling of traditional corporations and decentralized freelancers. DAOs encourage autonomy and self-management that freelancers are used to, while also offering the scale of economies that larger institutions can attain.
Just as the car was better transportation than the horse, DAOs have the potential to transform work. We can’t forget how society had to build roads, erect stoplights, and create infrastructure to make room for cars. So too must DAO participants build social norms, incorporate self-management principles, and build out the infrastructure within their fledgling organizations to fully realize their potential.
Take their promise of increased transparency. The open-source nature of the code, and immutable on-chain transactions offer a chance at increased transparency within an organization. But just because we can open the hood of a car, does that mean we understand all of an engine’s inner workings?
Marin Petrov, a friend and early participant in ‘the DAO’ shares his criticism of the technology as we see it today:
There are very few people who can read and understand code and especially the code that makes the DAO possible. If you are a programmer you might be one of those people, but the majority of people on this planet aren't. So the claim that making a computer code open-source will somehow make the company rules transparent is out of touch with reality.
DAOs have only recently become possible thanks to programmable money, but are only one piece of the organizational puzzle. The technology of DAO does not solve human interaction problems. Their decentralized structure may alleviate the principal agent problem, it is yet to be seen how workers in this new structure can best collaborate.
The internet is best at bundling and rebundling different things. Seems that we will see this in DAO too. Great summary!